Bosses unveil 10-point plan to protect process industry on Teesside

JUST days after the towering figure of Lord Mandelson - arguably the second most influential man in government - told the UK chemical industry that it was at the heart of government policy, Teesside has taken him at his word.

JUST days after the towering figure of Lord Mandelson - arguably the second most influential man in government - told the UK chemical industry that it was at the heart of government policy, Teesside has taken him at his word.

Today, local chiefs revealed a 10-point action plan to ensure the future of the sector at Wilton and its sister sites, with leading industry figures appointed to personally power through the changes.

Central to the plan is a commitment from Mandelson to back them - not with hard cash, but with a level of private/public sector collaboration unparalleled by any regional cluster.

The champions were hand-picked by North East Science and Industry Council chairman Bob Coxon who spent two months stitching together a safety belt for Wilton, which has crashed headlong into the economic downturn with the loss of more than 1,500 directly employed skilled staff and countless more in the supply chain.

Nationally, 10% of the chemical industry workforce has been shed with a prediction that it will be 2012 before it returns to pre-recession output levels.

The man with a plan was brought in following desperate calls for a strategy to prevent Teesside’s process sector losing momentum as first one then another foreign-owned firm pulled the plug.

Despite early hopes that new owners could be found for plants including Invista and Artenius, the Dow ethylene oxide and ethylene glycol plant, which is seen as central to much of the UK chemical industry, is the only one highlighted in the new strategy as deserving of direct government intervention.

There have been several false starts to negotiations over the plant, which has been the subject of a comprehensive engineering review by One North East in the hope of constructing a market-based rescue.

That may yet take several months to achieve, meanwhile, the strategy calls on government to ensure the Dow facility remains available to potential investors.

Elsewhere, the plan focuses on making a powerful case to government to locate one of its proposed carbon capture and storage (CCS) trial sites on Teesside.

Proposals already exist, drawn up by local firm Progressive Energy, but here they are described as being “vital to the future competitiveness of the process industry”, giving a compelling reason for Mandelson’s colleague at the Department of Energy and Climate Change to come down in favour of the North-east for several million pounds of investment.

Development of new feedstocks, essential to the transition of the process sector from fossil fuel behemoth to new green giant is also high on the list of priorities, while supply chain development, energy efficiency, training - particularly extended government support for apprentices - innovation, investment and infrastructure are all tackled in a masterplan that demonstrates a more sophisticated approach to meeting Wilton’s challenges than seen before.

Crucially, it brings together private - and often foreign owned - interests torn asunder by the long drawn out divestment of ICI - the architect of the Wilton site - along with whom much of the financial and strategic synergies that gave the site its strength disappeared.

“The action plan is very much by industry, for industry,” said Mr Coxon. “It captures the concerns of industry and its challenges but also how industry intends to take decisive action to secure its future working with the public sector.

“Our goal is to create new sectors of the process industry that can be internationally competitive with high growth potential.

“The Tees Valley stands united in its determination to secure future prosperity and I look forward to working with government to overcome the challenges we face.”

Teesside's 10-point plan coincides with the unveiling last week of the Chemical Industries’ Association national strategy, which called on government to support the £60bn sector along similar lines, but with the added plea from chief executive Steve Elliott that it wanted to be seen to be valued by government.

“Our remoteness from people in the street can mean a lack of public recognition. We are the modern day equivalent of Millwall Football Club. However, unlike Millwall, we do care,” he told an audience of 1,000, including several Teesside process chiefs along with Lord Mandelson.

Paul Booth, president of SABIC UK, who has long campaigned for change, also cares. “Recognising the importance of the chemical industry to the UK and the North-east economy, we must make these actions happen to secure the future of the industry,” he said today.

Dr Stan Higgins, chief executive of the North East Process Industry Cluster, said the plan broke down the issues that need to be addressed by industry into manageable pieces, “allowing industrial leaders to become a focal point through which others in the sector, regional and national government can contribute, to develop solutions that will secure the long-term future of the process industry in the Tees Valley.”

Hugh Lang, chair of Tees Valley Unlimited which provided strategic support during the drawing up of the plan and conducted a North and South Tees industrial needs study, also welcomed the new development, while

Alan Clarke, One North East chief executive, said it demonstrated determination and focus across public and private sectors to drive forward work needed to ensure the future success of a vitally important sector.

Page 3: MEET the industry leaders appointed to make changes in the process sector >>>

MPs pledge support as major plan for industry is unveiled

TEESSIDE'S MPs today threw their weight behind the plan.

They all said they would now be seeking the support of Lord Peter Mandelson Secretary of State for Business, Innovation and Skill.

Redcar MP Vera Baird said: “Despite the recession there is real optimism now about saving some of the installations we thought were lost and that's come about because of the steadfastness of the businessmen at Wilton.

“What we have to do is hold on very, very strongly to the platform of the petrochemical industry because upon it we can build.

"I think it is the way forward. There are some steps that need more urgent application than others, some steps that have better impact and stronger impact in the short-term than others which will have their impact in the longer term.

“It is an informed look at what is necessary to sustain Wilton and so by setting it out systematically Bob Coxon’s done a favour to people who may be looking to invest.

“It's important for attracting potential investors to safeguard some of the assets which we thought were under threat and to reassure the current investors that are already there that this plant has a big future.”

She said she would be inviting Lord Mandelson to visit saying: “I would be very pleased to see him come up to us quite soon, just to give a boost to the confidence of investors around the place.”

Dari Taylor, MP for Stockton South said: “My initial response was this is excellent. This is a very thoughtful document. They are focused about how and in what way the chemical process industry has a future.

“The whole team knows that if we're going to have a future, we have a future because it's in renewable's and in new technology and they are working that system hard as they can.

“We will be pushing that ten point plan as hard as we can so that the vibrancy of our chemical process industry maintains itself.”

Frank Cook, MP for Stockton North said the plan’s biggest strength was that it was the outcome of joint consultation and common agreement.

He said: “It’s been well thought out and well researched, it’s logical, it’s well worthy of support and I shall be canvassing in support of it.”

A year of strife...

Dow Chemical Company : Intends to close its Wilton ethylene oxide and glycol (EOEG) production facility, which employs 55, by the end of January.

Croda : As a result of Dow closing, around 125 jobs will go at the Wilton manufacturing plant.

Petroplus : Its North Tees refinery is to be converted for terminal operations with the loss of 75 jobs.

Biofuels Corporation : The future of Teesside’s only biodiesel refinery is unclear after it shed most of its staff.

Northumbrian Water : The collapse of Artenius cost it a £6m-a-year contract and saddled it with a £1.7m bad debt charge.

AND CONTINUED INVESTMENT...

Centre for Process Industries : The technology transfer and research organisation at Wilton won £32m in multiple tranches of public funding for its industrial biotechnology and printable electronics projects.

MGT Power : The renewable energy generator got the go-ahead for its £300m plant at Teesport and put out supplier contracts.

Sita UK : The waste management company fired up a £70m extension to its energy from waste facility at Haverton Hill.

Ensus : The £250m Wilton bioethanol plant was completed and is ready to come on stream.